Diosgenin transformation was studied in Streptomyces virginiae IBL-14, a soil-dwelling bacterium with diosgenin-degrading capacity. All of the derivatives isolated were identified as 4-ene-3-keto steroids. We cloned ChoL, a fragment of a cholesterol oxidase from S. virginiae IBL-14, and used gene-disruption techniques to determine its function in the oxidation of diosgenin to 4-ene-3-keto steroids. Subsequently, the entire open reading frame of ChoL was cloned by chromosome walking, and the His(6)-tagged recombinant protein was overproduced, purified, and characterized. ChoL consisted of 1,629 nucleotides that encoded a protein of 542 amino acids, including a 34-residue putative signal peptide at the N-terminal. ChoL showed 85% amino acid similarity to ChoA from Streptomyces sp. SA-COO. This enzyme can also oxidize other steroids such as cholesterol, sitosterol, and dehydroepiandrosterone, which showed higher affinity (K(m) = 0.195 mM) to diosgenin. The catalytic properties of this enzyme indicate that it may be useful in diosgenin transformation, degradation, and assay.